This is an excerpt from” Did Sharknado Chew Up All Your Lead Time?” found in the August 2013 edition of Retail Value Chain Federation’s monthly newsletter. To see the article in its entirety, click on RVCF LINK. It is part of an ongoing 5-part series on Demand Forecasting and Inventory Replenishment.
Lead Time is a significant factor in your supply chain performance. Like a shark chewing voraciously, Lead Time variance chews up profits in multiple ways. A shorter-than-expected lead time causes overstocks with additional carrying costs, theft, and potential damage issues. A longer-than-expected lead time creates out-of-stock service issues or additional product and freight costs, devours customer opinions and bottom-line profits.
Poor lead time performance also “chums” your supply chain with a barrage of activity; e-mails, phone calls, and impromptu meetings drain organizational energy and productivity while increasing stress levels.
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